Register of contract u/s 189

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Anita Tayshete (Querist)
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26 August 2025 Hello,

I have a small query in respect to register of contract. This is for private companies.
(i) Do we need to take omnibus approval in the first board meeting for related party transaction even if the transactions are at arm's lengths price and ordinary course of the business.
(ii) How can we maintain register of contract . should it be monthly, quarterly or yearly. I have seen many people maintaining on yearly basis and they mention date of contract as 01.04.- 31.03.
(iii) What should be the date of contract ideally if there are no contracts entered.

Regards
Anita

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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07 September 2025 Omnibus approval by the board in the first meeting is not needed for related party transactions that are both at arm's length and in the ordinary course of business. Such transactions are exempted from board and shareholder approval requirements under Section 188 of the Companies Act, 2013, but material transactions in listed entities may require audit committee oversight or shareholder approval depending on value and frequency.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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07 September 2025 The register of contracts (under Section 189) should be maintained with timely and accurate entries for contracts or arrangements with related parties. Although the law does not specify a period for updating (monthly, quarterly, or yearly), industry practice varies:
Quarterly updates are recommended for best compliance and governance, aligning with the audit committee’s quarterly review of related party transactions.
Some companies maintain it on a yearly basis, with the contract date spanning 01.04 to 31.03, but quarterly review is preferable and ensures timely information for board or audit committee review.

No contract date required in absence of contracts; register should simply record none entered.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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21 September 2025 Good luck....

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